Actuarial Valuation of Post-Employment Benefit Plans_Menard Consulting, Inc. Copyrighted
December 18, 2017
City of Dubuque Consent Items # 14.
ITEM TITLE: Actuarial Valuation of Post-Employment Benefit Plans
SUMMARY: City Manager recommending approval of the selection of
Menard Consulting, Inc. to conduct the GASB-75 actuarial
valuation for 2018
SUGGESTED DISPOSITION: Suggested Disposition: Receive and File; Approve
ATTACHMENTS:
Description Type
Actuarial Valuation of Post-Employment Benefit Plans- City Manager Memo
NNM Memo
Staff Memo Staff Memo
Menard Consulting, Inc. Agreement Supporting Documentation
Insurance Schedule J Supporting Documentation
THE CITY OF Dubuque
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TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Actuarial Valuation of Post-Employment Benefit Plans
DATE: December 11 , 2017
The City provides post-employment benefits for eligible participants who are enrolled in
City sponsored health plans. Since the City implemented GASB-75 in 2018, the City is
required to do another actuarial valuation in 2018.
Personnel Manager Randy Peck recommends City Council approval of the selection of
Menard Consulting, Inc. to conduct the GASB-75 actuarial valuation for 2018 at a cost
of$2,900.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
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Mic ael C. Van Milligen'�—�
MCVM:jh
Attachment
cc: Crenna Brumwell, City Attorney
Teri Goodmann, Assistant City Manager
Cori Burbach, Assistant City Manager
Randy Peck, Personnel Manager
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TO: Michael C. Van Milligen, City Manager
FROM: Randy Peck, Personnel Manager
SUBJECT: Actuarial Valuation of Post-Employment Benefit Plans
DATE: November 28, 2017
The City provides post-employment benefits for eligible participants who are enrolled in
City sponsored health plans. The benefits are provided in the form of an implicit rate
subsidy where pre-age 65 retirees receive health insurance coverage by paying a �
combined retiree/active rate for the self-insured medical and prescription drug plan and
an explicit rate subsidy where the city pays for the full cost of the fully insured life
insurance plan.
Actuarial valuations of our post-employment benefit plans were completed in 2009,
2011, 2013, 2015 and 2017. Since we will be implementing GASB-75 in 2018, we are
required to do another actuarial valuation in 2018.
I received quotes from two actuarial firms to perform the actuarial valuation. Quotes
were received from:
• SilverStone Group, Omaha, NE — cost $4,500
• Menard Consulting, Inc., Addison, IL — cost $2,900 �
I recommend that Menard Consulting, Inc. be selected to conduct the GASB-75
actuarial valuation for 2018. The Actuarial Services Agreement has been reviewed by
Senior Counsel Barry Lindahl and he finds the terms acceptable. I request that the City
Council pass a motion approving the Agreement and authorizing you to sign the
Agreement.
RP:alk
Meriard Corisultina, Inc,
1.690 W Lake Street, Suite F
Addison, IL 60101
Tel: 1630) 228-0676
www,MenardConsult.corn
November 24, 2017
Mr. Randy Peck
Personnel Manager
City of Dubuque
City Hall - 50 West 13th Street
Dubuque, IA 52001
RE: Fiscal Year 2018 GASB 75 Actuarial Valuation Services
Dear Randy:
fiC, Inc
Menard Consulting, Inc.
Actuaries & Consultants
Menard Consulting, Inc. ("Menard") appreciates the opportunity to provide actuarial consulting services to the
City of Dubuque ("Client") in connection with GASB 75 financial reporting requirements. This is the agreement
for the project.
Project Scope & Fees
The following services will be provided at the fee indicated.
Core Services
Prepare Actuarial Valuation report (includes footnote disclosure infoimation for audit)
Discussion(s) re. the Actuarial Report
Discussion(s) with Auditors re. Actuarial Report
Valuation Update & Consultation with Auditors in Off Valuation Years
Fee for the Fiscal Year 2018 Actuarial Valuation under GASB 75: $2,900
Services include roll -forward calculations in interim years at no additional cost.
Professional fees will be invoiced as follows:
• $1,400 upon commencement of work
• Remaining balance upon delivery of report
Invoice payment is due and payable within 30 days. Fees are all-inclusive of professional service time and
expenses.
You will not be charged more than the fee quoted above unless there is a signed Addendum to this
Engagement Letter.
Mr. Randy Peck
November 24, 2017
Page 2
General Business Terms for this engagement are attached and are incorporated into this Engagement Letter by
this reference.
This Engagement Letter, together with the General Business Terms, constitute the entire agreement between the
City of Dubuque and Menard Consulting, Inc. with respect to the subject matter hereof and supersede all other
oral and written representations, understanding, or agreements relating to the subject matter hereof
Please indicate your agreement by signing the signature page of this letter and returning it. If you have any
questions, please call me at (630) 228-0676.
Sincerely,
Menard Consulting, Inc.
ZICLCifil •
John Ritchie, ASA, MAAA
Mr. Randy Peck
N9vember 24, 2017
Page 4
GENERAL, BUSINESS TERMS
MC,, `nc
1. Services
It is understood and agreed that Menard Consulting, Inc.'s services may include advice and recommendations, but all decisions in
connection with the implementation of such advice and recommendations shall be the responsibility of, and made by, the Client. In
connection with its services hereunder, Menard Consulting, Inc. shall be entitled to rely on all decisions and approvals of the Client.
2. Payment of Invoices
Properly submitted invoices where payment is not received within thirty (30) days of the invoice date shall accrue a late charge of
the lesser of 1.0% per month or the highest rate allowable by law, in each case compounded monthly to the extent allowable by law.
Without limiting its rights or remedies, Menard Consulting, Inc. shall have the right to halt or terminate its services entirely if
payment is not received within thirty (30) days of the invoice date. Menard Consulting, Inc. shall also have the right at their
discretion to waive any late charges accrued.
3. Term
Unless terminated sooner in accordance with its terms, this engagement shall terminate on the completion of Menard Consulting,
Inc.'s services hereunder. This engagement may be terminated by either party at any time by giving written notice to the other party
not less than thirty (30) days before the effective date of termination.
4. Ownership
a) Menard Consulting. Inc. Technology. Menard Consulting, Inc. has created, acquired, or otherwise has rights in, and may, in
connection with the performance of services hereunder, employ, provide, modify, create, acquire or otherwise obtain rights in
various concepts, ideas, methods, methodologies, procedures, processes, know-how, and techniques (including, without
limitation, function, process, system and data models); templates; generalized features of the structure, sequence, and
organization of software, user interfaces and screen designs; general purpose consulting and software tools, utilities and
routines; and logic, coherence, and methods of operation of systems (collectively, the "Menard Consulting, Inc. Technology").
b) Ownership of Deliverables. Except as provided below, upon full and final payment to Menard Consulting, Inc. hereunder, the
tangible items specified as deliverables or work product in the arrangement letter to which these terms are attached (the
"Deliverables") shall become the property of the Client. To the extent that any Menard Consulting, Inc. Technology is
contained in any of the Deliverables, Menard Consulting, Inc. grants the Client, upon full and final payment to Menard
Consulting, Inc. hereunder, a royalty -free, fully paid-up, worldwide, non-exclusive license to use such Menard Consulting, Inc.
Technology in connection with the Deliverables.
c) Ownership of Menard Consulting. Inc. Property. To the extent that Menard Consulting, Inc. utilizes any of its property
(including, without limitation, the Menard Consulting, Inc. Technology or any hardware or software of Menard Consulting,
Inc.) in connection with the performance of services hereunder, such property shall remain the property of Menard Consulting,
Inc. and, except for the license expressly granted in the preceding paragraph, the Client shall acquire no right or interest in such
property. Notwithstanding anything herein to the contrary, the parties acknowledge and agree that (a) Menard Consulting, Inc.
shall own all right, title, and interest, including, without limitation, all rights under all copyright, patent and other intellectual
property laws, in and to the Menard. Consulting, Inc. Technology and (b) Menard Consulting, Inc. may employ, modify,
disclose, and otherwise exploit the Menard Consulting, Inc. Technology (including, without limitation, providing services or
creating programming or materials for other clients). Menard Consulting, Inc. does not agree to any terms that may be
construed as precluding or limiting in any way its right to (a) provide consulting or other services of any kind or nature
whatsoever to any person or entity as Menard Consulting, Inc., in its sole discretion, deems appropriate or (b) develop for itself,
or for others, materials that are competitive with those produced as a result of the services provided hereunder, irrespective of
their similarity to the Deliverables.
5. Limitation on Warranties
This is a Services Engagement. Menard Consulting, Inc. warrants that it shall perform services hereunder in good faith. Menard
Consulting, Inc. disclaims all other warranties, either express or implied, including, without limitation, warranties of merchantability
and fitness for a particular purpose.
Mr. Randy Peck
November 24, 2017
Page 5
.rte.
6. Limitation on Damages and Indemnification
a) The Client agrees that Menard Consulting, Inc. and its personnel shall not be liable to the Client for any claims, liabilities, or
expenses relating to this engagement for an aggregate amount in excess of the fees paid by the Client to Menard Consulting,
Inc. pursuant to this engagement, except to the extent finally judicially determined to have resulted primarily from negligence,
or the bad faith or intentional misconduct of Menard Consulting, Inc. In no event shall Menard Consulting, Inc. or its personnel
be liable for consequential, special, indirect, incidental, punitive or exemplary loss, damage, or expense relating to this
engagement.
b) The Client shall indemnify and hold harmless Menard Consulting, Inc. and its personnel from all claims, liabilities, and
expenses relating to this engagement, except to the extent finally judicially determined to have resulted primarily from
negligence, or the bad faith or intentional misconduct of Menard Consulting, Inc.
c) The provisions of this Paragraph and Paragraph 9 shall apply to the fullest extent of the law, whether in contract, statute, tort
(such as negligence), or otherwise. In circumstances where all or any portion of the provisions of this Paragraph are finally
judicially determined to be unavailable, Menard Consulting, Inc.'s aggregate liability for any claims, liabilities, or expenses
relating to this engagement shall not exceed an amount which is proportional to the relative fault that Menard Consulting, Inc.'s
conduct bears to all other conduct giving rise to such claims, liabilities, or expenses.
d) Menard Consulting, .Inc. agrees to defend and indemnify the Client, its officers and employees, against any and all clai
any kind arising out of its negligence in the performance of services under this Agreement.
e) Menard Consulting, Inc. shall provide insurance at all times during the performance of services under this agreement as
described in the attached Insurance Schedule J.
Of
7. Cooperation
The Client shall cooperate with Menard Consulting, Inc. in the performance by Menard Consulting, Inc. of its services hereunder,
including, without limitation, providing Menard Consulting, Inc. with reasonable facilities and timely access to data, information,
and personnel of the Client. The Client shall be responsible for the performance of its personnel and agents and for the accuracy and
completeness of all data and information provided to Menard Consulting, Inc. for purposes of the performance by Menard
Consulting, Inc.of its services.
8. Force Majeure
Menard Consulting, Inc. shall not be liable for any delays or non-performance resulting from circumstances or causes beyond its
reasonable control, including, without limitation, acts or omissions or the failure to cooperate by the Client (including, without
limitation, entities or individuals under its control or any of their respective officers,directors, employees, other personnel, and
agents), acts or omissions or the failure to cooperate by any third party, fire or other casualty, act of God, strike or labor dispute, war
or other violence, or any law, order, or requirement of any governmental agency or authority.
9, Limitation on Actions
No action, regardless of form, relating to this engagement may be brought by either party more than two years after the cause of
action has accrued, except that an action for non-payment may be brought by a party not later than two years following the date of
the last payment due to such party hereunder.
10. Independent Contractor
It is understood and agreed that each of the parties hereto is an independent contractor and that neither party is, nor shall be
considered to be, an agent, distributor, partner, fiduciary, or representative of the other. Neither party shall act or represent itself,
directly or by implication, in any such capacity in respect of the other or in any manner assume or create any obligation on behalf of,
or in the name of, the other.
11. Confidentiality and Internal Use
a) The Client agrees that all services hereunder and Deliverables shall be solely for the Client's informational purposes and
internal use, and are not intended to be and should not be used by any person or entity other than the Client.
b) To the extent that, in connection with this engagement, Menard Consulting, Inc. comes into possession of any proprietary or
confidential information of the Client, Menard Consulting, Inc. will not disclose such information to any third party without the
Mr. Randy Peck
November 24, 2017
Page 6
inc
Client's consent, except (a) as may be required by law, regulation, judicial or administrative process, or in accordance with
applicable professional standards, or in connection with litigation pertaining hereto, or (b) to the extent such information (i)
shall have otherwise become publicly available (including, without limitation, any information filed with any governmental
agency and available to the public) other than as the result of a disclosure by Menard Consulting, Inc. in breach hereof, (ii) is
disclosed by the Client to a third party without substantially the same restrictions as set forth herein, (iii) becomes available to
Menard Consulting, Inc. on a non -confidential basis from a source other than the Client which Menard Consulting, Inc.
believes is not prohibited from disclosing such information to Menard Consulting, Inc. by obligation to the Client, (iv) is
known by Menard Consulting, Inc. prior to its receipt from the Client without any obligation of confidentiality with respect
thereto, or (v) is developed by Menard Consulting, Inc. independently of any disclosures made by the Client to Menard
Consulting, Inc. of such information
12. Assignment
Except as provided below, neither party may assign, transfer or delegate any of its rights or obligations hereunder (including,
without limitation, interests or claims relating to this engagement) without the prior written consent of the other party. Menard
Consulting, Inc. may, without the consent of the Client, assign or subcontract its rights and obligations hereunder to (a) any affiliate
or related entity or (b) any entity which acquires all or a substantial part of the assets or business of Menard Consulting, Inc.
13. Waiver of Jury Trial
Menard Consulting, Inc. and the Client hereby irrevocably waive, to the fullest extent permitted by law, all rights to trial by jury in
any action, proceeding or counterclaim (whether in contract, statute, tort (such as negligence), or otherwise) relating to this
engagement.
14. Entire Agreement, Amendment and Notices
These terms, and the engagement letter to which these terms are attached, including exhibits, constitute the entire agreement
between Menard Consulting, Inc. and the Client with respect to this engagement, supersede all other oral and written
representations, understandings, or agreements relating to this engagement, and may not be amended except by written agreement
signed by the parties. In the event of any conflict, ambiguity, or inconsistency between these terms and the engagement letter to
which these terms are attached, these terms shall govern and control. All notices hereunder shall be (i) in writing, (ii) delivered to
the representatives of the parties at the addresses first set forth above, unless changed by either party by notice to the other party, and
(iii) effective upon receipt.
15. Governing Law and Severability
These terms, the arrangement letter to which these terms are attached, including exhibits, and all matters relating to this engagement
(whether in contract, statute, tort (such as negligence), or otherwise), shall be governed by, and construed in accordance with, the
laws of the State of Iowa (without giving effect to the choice of law principles thereof). If any provision of such terms or
arrangement letter is found by a court of competent jurisdiction to be unenforceable, such provision shall not affect the other
provisions, but such unenforceable provision shall be deemed modified to the extent necessary to render it enforceable, preserving to
the fullest extent permissible the intent of the parties set forth herein.
16. Survival and Interpretation
The agreements and undertakings of the Client contained in the arrangement letter to which these terms are attached, together with
the provisions of Paragraphs 1, 2, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15 and 16 hereof, shall survive the expiration or termination of
this engagement. For purposes of these terms, "Menard Consulting, Inc." shall mean Menard Consulting, Inc. and its subsidiaries;
all of their partners, principals, members, owners, directors, staff and agents; and in all cases, any successor or assignee.
Mr. Randy Peck
November 24, 2017
Page 3
MC; Ina
AGREEMENT
The services and terms described in the foregoing Engagement Letter dated November 24, 2017 to provide
GASB 75 Actuarial Valuation Services for the City of Dubuque and the attached General Business Terms are
hereby acceptable. We agree to the terms specified herein.
Accepted and Agreed: City of Dubuque, Iowa
By:
Title:
Date:
(Print) •
Michael C. Van Milligen
(Si
City Manager
City of Dubuque Insurance Requirements for professional Services
; INSURAN�E SCHEDULE J
1. Menard Consultin�,Inc. shall furnish a signed cert(ficate of insurance to the City of Du.buque, lowa for I
the coverage required in �xhibit I prior to cornmencing work and at the end of the proJect if the '
term of work is longer than 60 days. Contractors presenting annu�l certificates shall present a '
certificate at the �nd of each project with the final billing. Each certificat� shali be prepared on '
the most current�CORD form approved by the lawa fJepartment of Insurance or an equiv�lent 'I
approved by the Finance Director, Each cerfificate shall Include a statement uncler Description ofi ''
Operatioi7s as to why the certlficate was issued, �g� Praject� or Pro)ecf Location at I
or construction of i
2, All policies of insur�nc�required hereunder shall be with an insurer autl�orized to do business in
lowa and all insurers shall have a rating of A or better in the current A,M. Best's Rating Guide,
3, Each certificate shall be furnished to the Personnel pepartment of the City of Dubuque,
4, F�ilure to provide coverage required by this Insurance Schedule shall not be deemed a waiver of
these requlrements by the City of Dubuque. �'ailure to obtain or malntain the required insurance
shall be cons(dered a materlal breach of this agreement,
5. Contractors shall require all subcansultants and sub-subconsultants to obtain ancl maintain during
the perFormance of work Insurance far the coverages described in this Insurance Schedule and
shall obtain cerfificates of insuranc�s from all such subconsultants and sub-subconsultants.
Contractors agree that they shall be liable for th�failure of a subcansultant and sub-
subconsultant to obtaln and rnaintain such covorages, The City may request a copy oF such
'�� certificates from the Contractor.
6. All required endarsements shall b� attached to certificate of insurance,
7, Whonover a specific ISO form is listed, r�quired the current edition afi the farm must be used, or
an equivalent fiorm may be substltuted if approved by the F'inance Director and subject to the
� contractor identifying �nd listing in writing all deviatlans and exclusions from the ISO form.
B, Confractars shall be requir�d to c�rry the minimum covorage/limits, or groat�r if required by law
or other legal agreement, in Exhibit I, If the contractor's limits af liability are higher than the i
required m(nimum Iimits th�n the provider's limits shall b� this agreement's required lim(ts, i
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' Page 1 ofi 4 Sch�dule J Professional Servic�s November 2017
City of Dubuque Insurance Requirements for I'rofessional Services
IN�URANCE SCHEf�ULE J (continued)
Exhibit I
A) COMMEFtCIAI, GEN�RAL LIABILITY
Gen�ral Aggr�gate Lfmli $2,Q00,000
Products-Completed Operations Aggregate Lfmit $1,000,000
Persanal and Adv�rtising InJury Limit $1,000,000
Each Occurrence $1,000,000
Fire Damage Limit(any one occurrence) $50,000
Medical Payments $5,000
1) Covorage shall be written on an occurranco, not claims made, form. The general
liability coverage shall be written In accord with ISO form CGOOQ1 or business
owners form [3P0002, All deviations from the standard ISO commercial general
Ilability form CG 0001, or business owners form Bf' 0002, sl7all be cle�rly i,
identifled,
2) Include ISO endorsemont farm CG 25 04"Designated Lacation(s) G�neral I
Aggregate Limit" or CG 25 03"Desig.nated Construction Project(s)Gener�l
� Aggregate Limit"as �ppropriate.
3) Include endors�ment Indicating that caverage (s primary and non-contributory, �
4�) Include Preservation of Governmental Immunities Endorsement, Sam le
� p I
attached), ' �
6) Include additional insured endorsement for:
The City of Dubuque, inciuding all its elected and appointed officials, all its
� employees and volunte�rs, all fts boards, commissions and/or authorities and
their board mernbers, employees and volunteers. Use ISO form CG 2026,
6) Pollcy shall include Waiver of Rlght to Recover from Others endorsement,
B) AUTOMOBIL,� LIARILITY �
Combined Single Limit $1,000,000
C) WORKERS' COMP�NSATION & �MALOYERS LIABILITY
Statutory benefits covering all employees injured on the Job by accident or disease as
prescribed by lowa Code Chapter 85 as amended.
Caverage A Statutory—State of lowa
Coverage B �mployers L.iability
� Each Accident $100,000
Each Employee-Dise�se $1Q0,000
Policy Limit-Disease $500,000
Policy shall include Waiver of Right to Recover from Others endorsoment,
Nonelection of Worl<ers' Compensahion or �mployers' Liability Coverage under low2
Code sec. 87.22
�yes ____form attached
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Page 2 of 4 Schedule J Profession�l 5ervices November 2017
City of DubuquE Insurance Requirc�ments far Professional Serviees
, INSURAI�CE S�f-IEDULE J (continued)
D) UMBRELLA/CXCESS LIABII.ITY $1,000,000
Umbrella/excess I(ability coverage must be at least following form with the underlying
policies Included herein,
E) PROFES510NAL LIABILITY $1,000,000
Provide evidenca of coverage for 5 years after completian of project,
F) CYBER LIABILITY $1,000,000
' X yes �no
�Coverage for First and Tl�ird Party I(ability including but not limited to lost data ancl
restoration, loss of income and cyber breach of lnformation.
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Page 3 of 4 Schedulo J Prof�ssional Services November 2017
City of Dubuque Insur�nce R�quirements for Professional Servicss
�
PRES�I�VATION OF �0!/EI�NMENTAL IMMUNITIES EN�ORSEMENT i
I
I
�
1, Nonwaiver of Governmental Immunitv, The insurer expressly agrees and states that th� purchase
of this �olicy and the including of the City of bubuque, lowa as an Additianal Insured daes nat waive any
of the defenses of governmental immunity available to the City of Dubuque, lowa under Code of lowa
Section 670.4 as it is now exists and as it may be amended from time to time,
2. Claims Coveraqe, The insurer further agrees that this policy of insurance shall cover only thase
claims not subJect to fihe defense of governmental immunity under the Code of lowa Section 670,4 as (t
now exists and as it may be amended from time to time, Those claims not subject to Code af lowa
Section 670.4 shall be covered by the terms and conditions of this insurance policy,
3, Assertion of Government ImmunitV.The City of Dubuque, lawa shall be respons(ble for asserting
any d�fense of governm�ntal immunity, and may do so at any time and shall do so upon the timely written
request of the insurer,
4, Non-Denial of Caveraqe, The insurer shall not deny coverage under this policy and the insurer
shall not deny any of the rights and ben�fits accruing to th�City of Qubuque, iowa under this polfcy for
reasons of gavernmental immunity unless and until a court oF competent)ur(sdfction has ruled in favor of
the defense(s)of governmental immunity asserted by the City of Dubuque, lowa
No Other Chanae in Policy, The above preservatian of governmental immunities shall not otherwise � I
ch�ng� or alter tho cnverage available under the policy, � I
� .
(DEPARTMEN7 MANAGER: Fll�l. IN AL.L BLANKS ANp CHECK BOXES)
)
Page 4 of 4 Schedule J Professional S�rvices Navember 2017